In Efforts To Save Costs, Krispy Kreme Plans To Automate Around 18% Of Its Doughnut Production

Just a year and a half after its return to the public markets, Krispy Kreme Inc DNUT has reportedly begun testing new technology that would cut back on repetitive labor and expects to automate about 18% of its total doughnut production over the next 18 months.
The company expects the investment of so far $6 million to produce $2 million in annual savings.
Citing Josh Charlesworth, CFO of Krispy Kreme, the Wall Street Journal reported the moves to improve revenue and profitability and cut debt amid the economic slowdown.
Related: Krispy Kreme Reaffirms FY22 Outlook Post Mixed Q3 Results.
Krispy Kreme expects to generate revenues of $2.15 billion by the end of FY 2026, up 41% from its projected revenue this year.
The company has raised prices this year to offset inflation, and is also investing in automation to save on labor costs in its doughnut theater shops, said Charlesworth.
“There’s a lot of manual intervention behind the scenes,” said Mr. Charlesworth. For instance, he said that employees manually dip doughnuts into bowls of icing.
Krispy Kreme said it plans to achieve a total net leverage ratio of 2-2.5 by the end of 2026 and expects the ratio of 3.67 to come in at about 3.6 by the end of the fiscal year.
Price Action: DNUT shares closed at $11.74 on Friday.